The news that New York-based hedge fund Tiger Global Management is planning to cash in some of its $40 billion portfolio has sent a ripple of unease through some companies.
Tiger’s investment portfolio is vast. The company is a big backer of start-ups and established tech firms, investing in hundreds of companies as they grow from early-stage to scaling enterprises. Its previous investments include Netflix, LinkedIn and Eventbrite.
Among its current portfolio are stakes in Bytedance, Flipkart and fintech Stripe, the Irish-founded success story that has grown to a multibillion dollar payments business.
But Tiger Global, like many investors these days, has seen a change in its fortunes. And so reports are that it is exploring its options.
The company hasn’t commented on what stakes it is willing to part with but it will have to be something sufficiently attractive to raise the money it wants and tempt investors in the secondary market.
If reports are accurate, Tiger valued its stake in Stripe at $1.5 billion in June last year. However, the fintech has since raised funding that put its valuation at $50 billion, less than the $95 billion valuation it got from a 2021 funding round, as the tech downturn took some of the wind from the industry’s sails.
Speculation around a stock market flotation has followed Stripe for some time. But so far, no date has been set.
Reports in early January were that Stripe had told staff it would decide within 12 months whether it would allow staff to sell shares in a private sale or go for an IPO. But the $6.5 billion it raised in March, related to vesting restricted stock units the company handed out to attract and retain staff, put paid to that talk – at least in the short term.
Whether Tiger Global will wait out the potential stock market debut or cash in now remains to be seen.